VP for Business Development at Chegg Elizabeth Harz speaks at the "Research Revealed" seminar during Advertising Week in New York in this October 2012 file photo. When you have an important investment or shopping decision, Hamm writes, make sure to research it with unbiased sources.

Let’s say you’re worried that your finances aren’t being organized effectively. You’re not really sure what’s wrong, but you have a gut feeling about it. You decide to go to a financial advisor, who tells you that, indeed, your finances are in a bad place. He points out several perceived flaws and pledges that he can fix them.

Let’s say you’re leaning toward putting some of your money into an annuity. You do a few Google searches and, based on the results you find, it sure seems like buying an annuity is a really good idea.

Let’s say you’ve seen repeated advertisements and product placements that convince you that a particular product is really cool. You go into a store, see it on a well-designed display, and find yourself really wanting this item you don’t need. You sigh, decide that you can probably afford it, and head to the checkout aisle.

What is confirmation bias? Confirmation bias is a tendency of people to favor information that confirms what they already believe. A person with conservative political leanings might believe in the accuracy of Fox News, for example, while a person with liberal political leanings might be an avid viewer of MSNBC. Both of these people will view their news source as unbiased and correct and view the other news source as farcical (I actually think they’re both farcical, but that’s a different subject entirely…).

Confirmation bias can be incredibly expensive. It can lead you to poor investment choices. It can lead you to extremism in your personal beliefs (which can be very alienating). It can lead you to poor spending decisions.

Naturally, confirmation bias is something you’re going to want to overcome most of the time. Whenever you’re making an important decision about your money or about something else you’re going to invest heavily in (such as a political movement), you owe it to yourself to figure out if confirmation bias is pushing you into this decision.

For me, the most effective tool at overcoming confirmation bias is unbiased information, particularly multiple sources of it. I try to look for sources of information that have no vested interest in anything but the accuracy of the data.

For example, an investment firm will have a vested interest in making their investment products look particularly good, so they’ll choose data points that will make their investments look great. I’ll want to look for other sources of information on investments.

On the other hand, places like Consumer Reports have a vested interest only in reporting reliable information about products. They don’t have a vested interest in one product selling well and another product selling poorly.

Sources I tend to trust include non-politicized government agencies (meaning ones that are staffed by people whose jobs don’t depend on the current administration or the result of elections) and independently-funded review and comparison organizations (like Consumer Reports for consumer products or Morningstar for investment options).

(It’s important to note that many people who prey on confirmation bias want to undermine unbiased information. They’ll attack the source of a piece of unbiased information rather than looking at what the information itself is saying. If you’re going to pay attention to such attacks, you must find out for yourself whether those attacks have any justification or not.)

Beyond that, I always value data that comes from many different sources. If I can’t find data that comes from an unbiased source, I try to find data from sources that would have different biases.

For example, when I’m making up my mind on a political story, I’ll read an article on it from a fairly conservative source and then read an article on it from a fairly liberal source. The elements that the stories have in common are generally the ones that are reliable, while everything else is highly suspect.

The more important a decision is, the more sources of information I’m going to want. I most highly value unbiased sources of information, but I’m often forced to include some sources of biased information, so I do my best to balance them.

If the data tells me that my initial hunch was wrong, then I’m willing to say I’m wrong. This is absolutely vital. You must be able to walk away from the ideas you have if the data proves you wrong. If you cannot do that, then you will repeatedly fall prey to confirmation bias.

What’s the take-home message here? When you have an important decision, research it. Find unbiased sources of information. Find information with conflicting biases – one on one side and one on the other. Compare them all and see what idea really does come out on top, and then go with the one that’s actually backed up by data.

If you make major financial moves based on a hunch that was reinforced by a salesman or the first two results of your Google search, you’re going to find yourself on the losing end of the deal more often than not. Take your time and find many sources of real information before you make a move.

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